Kenneth Rijock

Sunday, September 6, 2015

PANAMA'S SECURITIES REGULATOR SENTENCED TO FIVE YEARS FOR KILLING INSIDER TRADING INVESTIGATION

Ignacio Fábrega, the former Director of the Superintendency of Securities (SMV), Panama's securities regulatory agency, was handed a sentence for five years in prison this week, for his role in the Financial Pacific/Petaquilla Mining insider trading scandal. Fábrega admitted delivering confidential information, detailing his agency's investigation into the FP scandal, to then-President Ricardo Martinelli, and his associates, and subsequently dismissing all pending investigations into misconduct at FP.

The defendant , who pled guilty to the charge of official corruption, had recently been a fugitive from justice for several months, after he fled house arrest. Martinelli and former Tourism Minister Solomon Shamah, a suspected narcotics trafficker, have been implicated by his statements to anti-corruption prosecutors. Many ministers in Martinelli's cabinet made millions of dollars, by illegally trading in inside information on Petaquilla, defrauding hundreds of Canadian & American investors who did not have the benefit of non-public information about developments concerning the company's gold mine. Members of Panama's shadowy criminal elite also illegally made massive profits in the insider trading scandal.

Fábrega, while in office, was known to ignore any securities law violations, when they implicated any of Martinelli's inner circle of associates, and concealed the fact that the former president was a $3m investor in FP, and obeyed any directions he received from him, notwithstanding his obligations as head of his country's securities regulator.